Kotak Life
Close

Buy a Life Insurance Plan in a few clicks

Close

Now you can buy life insurance plan online.

Kotak e-Term Plan

Kotak e-Term Plan provides a high level of protection to your loved ones in your absence. Know more

Kotak Guaranteed Savings Plan

Kotak Guaranteed Savings Plan is a savings and protection plan that helps you achieve long-term financial goals and provides an insurance cover against any eventuality. Know more

Kotak E-Invest

Kotak e-Invest plan is a complete Unit-Linked Insurance Plan that can be customized as per your goals and needs. Know more

Kotak Health Shield

Kotak Health Shield Plan helps secure your finances in sudden medical expenses such as Cardiac, Liver, Neuro, and Cancer (all early and significant illness stages/conditions of cancer), along with offering protection for personal accidents - in case of accidental death or disability. Know more

Kotak Lifetime Income Plan

Kotak Lifetime Income Plan gives you the security of your income continuing throughout your life and in your absence throughout your spouse's lifetime! Know more

Are Financial Planning and Tax Planning the Same Thing?

Are Financial Planning and Tax Planning the Same Thing?
  • 9th Mar 2021 |
  • 2,038

Tax planning and financial planning are two commonly used terms. Planning your taxes and finances support the fulfilment of your financial objectives. Thus, both can aid in selecting the most suitable investment option for your needs. However, there exists some difference between tax planning and financial planning. It is essential to understand this to make informed investment decisions.

How does a financial plan work?

You can plan your finances better by following the steps given below.

  • Defining your financial goals - This requires assessing your current financial position and listing the monetary goals to be achieved. Further, you may classify these goals into short-term, medium-term, and long-term.

  • Defining your financial goals - This requires assessing your current financial position and listing the monetary goals to be achieved. Further, you may classify these goals into short-term, medium-term, and long-term.
  • Implementing and reviewing - After selecting the right financial instruments as per your investment preferences, it is important to periodically review your portfolio. This aids in ensuring that the portfolio performance is in line with the planned strategies.

How does a tax plan work?

Tax planning involves assessing your investments from the viewpoint of taxation. It thus helps you in reducing your tax liability. A reduced tax burden can also contribute to your disposable income. You can make use of the tax saved towards making investments or meeting other necessary expenses. Tax planning consists of three types:

  • Purposive planning - This aims at availing the maximum benefits under the requisite sections of the Income Tax Act of 1961. These benefits include deduction from the gross total income and exemption of certain types of income.
  • Permissive planning - Under this approach, the tax planner plans within the framework of law by making use of the relevant provisions and clauses of tax benefits.

  • Short-range and long-range planning - Short-range plans are limited to a specific financial year. They include investing in a particular tax-saving instrument that can qualify for tax deductions. On the other hand, long-range plans have a wider scope. For example, transfer of an asset without consideration to a minor child requires the clubbing of income till the minor attains the age of majority, i.e. 18 years. Thereafter, it is treated as the child’s income.

Difference between tax planning and financial planning

Given below is a tabulation of the key points of differentiation between tax planning and financial planning.

Particulars Financial Plan Tax Plan
Professionals who can help Financial Advisor Tax Planner
Objective of planning To have sufficient funds for various purposes like purchasing real estate, covering the costs of higher education or children’s marriage, retirement planning, etc.
Moreover, saving tax can also be a part of financial planning. It aims to reduce your tax liability.
It aims to reduce your tax liability

Financial planning and tax planning with Kotak

Certain investment avenues aid dual planning benefits of tax and financial planning. For example, Kotak Life Insurance offers savings and investment options with multiple benefits. Here are some of the advantages

  • Life coverage that extends financial support to your family in your absence.
  • An investment component that offers non-linked or market-linked plans. This aids in creating a corpus for achieving your financial goals.
  • The premium amount is allowed as deductions subject to the compliance of Section 80C.
  • The maturity amount is tax-free on fulfilling the conditions of Section 10(10D). Besides, the death benefits are fully exempted from tax.

As you can see, buying an insurance plan benefits in financial as well as tax planning.

Kotak e-Term Plan

Features

  • Nominal Cost
  • Multiple Plan Options
  • Flexible Payout Options
  • Critical Illness Rider
  • Tax Savings
  • Long term Coverage

Ref. No. KLI/22-23/E-BB/492

T&C

Browse our library of resources

- A Consumer Education Initiative series by Kotak Life

Similar Articles

Is It Good To Buy A Term Insurance Plan In 2022?

Can I Make Changes to My Term Insurance Policy Post Purchase?

Term Insurance Calculator - Everythng You Need To Know

Ensure Protection Against Death, Disease & Disability With Life Insurance

What Happens to Term Insurance Plan With No Beneficiary - Kotak Life

How To Choose the Right Term Insurance Plan?

Can I Get Term Insurance on Behalf of My Spouse?

9 Ways to Help Family Members in Financial Trouble

Planning For Children's Future

Can I Buy Term Insurance for a COVID-19 Patient?

Is Group Term Life Insurance Provided By Employer Sufficient?

What is the Right Term Period For Term Insurance Policy? Here's How You Should Choose!

Does Your Term Insurance Plan Cover Death Due to COVID-19?

What Happens if you Hide Facts in your Term Insurance?

Term Insurance Basics You Should Know

Is Term Life Insurance Plan an Investment or Expense?

Term Plans are Definitely Cheaper than You Think!

5 Things To Consider While Buying Term Insurance Plan

Online vs Offline Term Insurance: Which Is The Better Option To Buy

Term Insurance With Riders In India

How to Buy 1 Crore Life Insurance Policy Without Medical Test

Choosing Riders for Insurance Plans

Why should single women purchase term life insurance?

How To Calculate The Amount Of Term Life Insurance You Need?

Can Non-Resident Indians (NRIs) Buy Term Insurance In India?

Term Insurance: Smokers vs Non-Smokers

6 Reasons That Make Term Insurance a Must Buy

Do I Need to Give a Medical Test for Term Insurance in India?

Why is it important to buy term insurance plan?

Term Plan with Spouse Cover

Why Buy Term Insurance Even at Rising Rates?

Insuring yourself against Ill Health with a Critical Illness Rider

Increasing Term Insurance and Riders

Can Term Insurance Plans Be Purchased As A Gift?

Is a Term Insurance Policy Portable?

What Are the Best Term Insurance Plans for Planning Retirement?

What are incremental term insurance plans?

Is term Insurance Needed for People With No Dependents?

10-Year Term Life Insurance Policy - Explained in Detail

Individual Life Insurance vs. Group Term Life Insurance

Eligibility Criteria for Buying Term Insurance in India

Why Premium Amount for Term Insurance is So Low?

How to Ensure That Your Term Insurance Claims Are Never Rejected?

What is Term Insurance - A Complete Guide

5 Reasons to Buy Term Insurance When You are in Your 30s

Term Insurance: What Happens When You Don’t Pay Your Premiums?

What is a Joint Term Insurance Plan? Key Benefits of Joint Term Plan

Different Types of Premium in Term Insurance

8 Things To Do After Buying Term Insurance

Is There Any Tax Benefit on Term Insurance?

Endowment Plans vs Term Plans: Understanding the difference

Are The Add-ons and Optional Features of Term Insurance Plans Actually Beneficial?

Term Insurance Age Limit – Term Plan for All Age Groups

Is ₹1 Crore Term Insurance Good Enough Cover?

Why Term Insurance Is Better Than ULIP?

Gift Your Father A Term Insurance Plan This Father's Day

How To Choose the Right Sum Assured Under a Term Plan?

How Does A Term Life Insurance Work in India?

4 Reasons Why You Need Critical Illness Cover

Why Buy Term Insurance Plan With a High Cover?

Why Married People Should Buy Term Insurance Under MWP Act?

Why Should You Not Take A Term Plan Without Medical Test in India?

What Is a Renewable Term Insurance Policy?

Key IRDAI Regulations That Changed Face Of Term Insurance Industry In 2020

How Does Term Life Insurance Work? Learn the Benefits

Steps on How to Buy Term Insurance Online

6 Types of Death not covered in Term Insurance Plan

Why 1 Cr Term Plan Is Necessary For Family?

Advantages of Buying Term Insurance in Your 50s

Term Insurance with Critical Illness

Should You Buy a Term Plan After 40?

What is a short term insurance policy?

How Not To Get Your Term Insurance Claim Rejected

5 Term Insurance Benefits for Single Women

Term Life Insurance Plan for Smokers vs Non-Smokers

Difference between Term Insurance and Life Insurance

What Types of Deaths Are Covered in a Term Insurance Plan?

All About Term Insurance Inbuilt Coverage

Why Should You Buy Term Insurance in 2022?

Why Surrendering Your Term Plan Policy In The Final Phase Maybe A Bad Idea?

Make Your Online Term Plan Your Familys Monthly Payout

How Much Term Life Insurance Cover Do I Need in India?

Understanding Term Insurance Riders

What is Insurance Premium - A Detailed Guide

Why Term Plan Should Be The First Step To Securing Your Future?

What is Critical Illness Policy

Insurance Policy for Housewife In India

Can A Housewife Buy a Term Insurance Plan - All You Need to Know

Insuring Against Disability With Disability Insurance Rider

How to Compare Term Insurance Online

Which Term Insurance to Choose: Lump Sum or Staggered Pay-out Plan?

How to Identify Term Insurance According to Your Needs?

Term Vs. Whole Life Insurance: Which One You Should Buy in India?

Term Insurance: Most Common Term Insurance Myths Explained | Kotak Life

Term Insurance Plans and Policies for Smokers

Insuring Against Accidents with an Accidental Death Insurance Rider

Why Term Insurance Is Important in times of COVID-19?

Protection for your family

What Are Insurance Riders and How to Choose Them in a Term Plan?

Reasons You Need Term Insurance Plan as a Self-Employed Person

Can I Extend the Tenure of My Term Insurance Plan?

How Much Cover Should I Take In A Term Plan?

Buying A Term Insurance? Don't Ignore the Claims Settlement Ratio

Everything About Claim Settlement Ratio for Term Insurance

Cost of Term Insurance Likely to Increase Soon

What is Form 16, Form 16 part A, Form 16 part B, Information Required and FAQs

Different Types of Protection Plans

Is it a Good Time to Buy Term Insurance During the COVID-19 Pandemic?

Does Term Insurance Cover Accidental Death?

How to Surrender Term Life Insurance When you have No Liabilities

Advantages & Disadvantages of Term Insurance in India

8 Benefits of Term Insurance You Should Know

Comparing Term Plans – What Should You Look Out For

Best Investment Plans for Children - Secure Your Child's Future

Why Should You Add a Rider to a Term Insurance Plan?

Planning For Son or Daughter's Wedding

Is Life Insurance Investment Worthy Enough

Insuring Protection Against Death With Death Insurance Rider

टर्म इंश्योरेंस क्या है? टर्म इंश्योरेंस का मतलब

Ideal Features of a Suitable Term Plan - Act Now for a Stress-free Future

What Is a Passive Income? Why Should You Use It to Buy a Term Plan?

Tips to Choose the Right Term Period for Term Insurance Plan

Busting Myths and Facts About Term Insurance Policies

What are the Documents Required for Term Insurance Plan?

Top 3 Reasons Why You Should Buy A Term Plan Now

What Should Be The Duration Of Your Term Plan in India?

4 Methods to Calculate How Much Term Insurance You Need

Key Differences Between Term Insurance, ULIPs, And Health Insurance

Importance of Term Insurance at Every Stage of Your Life

4 Things To Expect From Your Term Insurance Plan in India

Do Beneficiaries Pay Taxes on Term Insurance?

Term Insurance – Why You Must Include In Your Financial Planning?

Why Should New Parents Buy Term Life Insurance?

What Should You opt for - Limited or Premium Pay?

Do You Need Term Insurance Cover After Retirement?

Can Senior Citizens Avail Term Insurance?

Which Death Type Does Your Term Plan Not Cover?

All you need to Know about Term Insurance Plans for Housewives

What Is the Correct Age to Buy Term Insurance?

Why Buying a Term Plan Is Smarter Than Traditional Life Insurance Products

9 Most Frequently Asked Questions on Term Insurance

Should You Have Multiple Term Life Insurance Policies?

Buying A Term Insurance Plan? Take These Factors into Account

Why does every working woman need life insurance?

5 Benefits of Early Retirement Planning

Tax Benefits of Term Insurance in India

Calculating Term Insurance Premium

Can You Increase Your Term Insurance Cover?

When is the Right Time to Buy Term Life Insurance Policy for Yourself?

Know How to Invest at Every Age for Larger Returns

While Buying Term Insurance Compare Features, Not Just Premiums

How Much Term Insurance Do I Need

What All Documents Required For Term Insurance In India?

Make Your Online Term Plan Your Family's Monthly Pay Cheque

Should Youngsters, Working Couples Buy Term Insurance Plans?

How To Change The Nominee in Term Insurance?

8 Factors to consider before choosing a Critical Illness Insurance